Getting to grips with car insurance groups

Car insurance groups play a huge part in determining the size of your motor premium. But do you know which group your vehicle falls into – and why it’s in one and not another? And how much difference would it make to the cost of your premium if you switched to driving a car in a different group?

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Here we delve into the detail to find out how the system works so that, next time you change car, you’ll know how it will impact the cost of your motor policy.

Joining a group

Every car manufactured for the UK market is allocated to a group by the insurance industry. You can find out which group yours falls into by typing make and model into http://www.thatcham.org/.

There are 50 groups, in addition to 20 for motorbikes and a further 20 for light commercial vehicles (that’s vans to you and me). The basic rule of thumb is that, the higher the group, the higher the premium. The bulk of insurers follow the system, though they are not obliged to do so. They will always refer to their own experience of insuring a particular model when arriving at a price.

And, of course, your personal details will play a huge part in determining the size of the premium.

Kit cars, imported cars and cars that have been converted or modified away from the manufacturer’s specification are not allocated to a group, so the insurer would use its own data to arrive at a quote.

The factors used to calculate group ratings include:

Cost of repairs: insurers say over half the money they pay out in claims goes on repairs – spare parts and labour. When working out which group to put a car in, they take into account the vulnerability of the vehicle to damage in an accident, the cost of parts and the typical repair time. They can even factor in how long it would take to repair the paint finish.

Performance: cars with swift acceleration and high top speeds are bumped up to higher groups. The claims statistics used by insurers indicate that high performance cars generate more frequent claims – and they also tend to be expensive cars that cost a lot to put back on the road.

Security: good security will help a car secure a lower group rating – but remember that these must be fitted as standard. If you add security measures of your own, you’d need to tell the insurer separately when getting a quote. Insurers look for Thatcham-approved security features such as high-spec door locks, alarms, immobilisers, glass etching, coded audio equipment and prominent VehicleIdentification Numbers.

Choice of model

Most cars come with a choice of model – and different models can land in widely different car insurance groups according to their specification and performance. Take the hugely popular Fiat 500 – its 33 variations cover the spread of groups from 9 (the Pop 1.2 litre) to 29 (the Abarth Competizione Essesse), so your final decision might well be influenced by the cost of insurance.

I ran a quote for the 500C using MoneySupermarket’s price comparison facility – the cheapest quote for the Pop would cost me £189 for a year with echoice, but to insure the snazzy Abarth model, again with echoice, would set me back £265.

And I’d need to agree to a bigger voluntary excess – I opted for £100 with both models, but the insurer wants £125 on top of a hefty £175 compulsory excess for the Abarth. That means I’d have to contribute the first £300 of any claim.

If I really wanted to turn some heads I probably wouldn’t let the higher insurance costs deter me from getting the flashier model. But the quotes are reasonably friendly anyway, because I’m a middle-aged bloke living in a quiet county town (and my head-turning days are long gone). Someone with fewer miles on the clock living in a city would face much higher premiums and a bigger differential between the two, which could easily influence their decision.

Our cars at MoneySupermarket

A quick informal survey of colleagues revealed a spread of cars – from Daewoo Matiz (group 5) to an Audi A3 TDI (group 27), and from a Vauxhall Corsa (group 2) to a BMW X1 23D M Sport (group 26). My actual car is a Toyota Verso (the Abarth wouldn’t really work with two kids) that slots into the distinctly modest group 13.

At the moment I’m paying £220 to insure the Toyota. If I indulged my burgeoning mid-life crisis and bagged a Lotus Elise Convertible in Group 42, the cheapest premium I’d get through MoneySupermarket would be £442 (including a £500 excess) with esure – twice the price, and a rich source of material for conversation at the dinner table.

It’ll be a while yet before I cross the threshold of a Porsche, Infiniti or Maserati dealership with means and motive, but when I do I can expect to run my quivering fingertips over cars couched comfortably in group 50. The same would apply if I were looking at top-of-the-range BMWs or Mercedes.

If I won the lottery and decided that only a Rolls Royce or a Lamborghini would serve for the weekly trip to Tesco, I’d have effectively left even group 50 in my sweetly-perfumed exhaust fumes – the insurers would be relying almost entirely on their own data and my personal details, such is the value of the vehicles.

At the other end of the scale, cars such as the enthusiastically-named Volkswagen up! and the Fiat Panda are the proud occupants of group 1.

Someone who can afford a luxury car costing deep into six-figure territory would probably not balk at a four-figure insurance premium. But for those of us of more modest means, it’s worth checking the insurance group before deciding which car best suits the budget.

Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.